Enrollment In Obamacare's Federal Exchange, So Far, May Only Be In 'Single Digits'

On October 1, the debut of the Affordable Care Act's subsidized insurance exchanges, many visitors saw a graphic informing them that the web site was not accessible.

On October 1, Obamacare’s subsidized insurance exchanges went live. Most of the exchange websites crashed on the first day, a development that led some of the law’s supporters to conclude that there was overwhelming demand for Obamacare’s insurance products. But the Obama administration isn’t releasing figures as to the number of Americans who have actually signed up for exchange-based coverage. “Very, very few people that we’re aware of have enrolled in the federal exchange,” said one anonymous insurance industry official to the Washington Post. “We are talking single digits.”

Exchange agencies walk back high-traffic hype

Other exchanges have had to pare down their initial statistics. Covered California, that state’s subsidized insurance exchange, initially claimed that its website had received 5 million hits on October 1. They later had to revise that number down 87 percent, to 645,000. KUSI-TV in San Diego is reporting that not one policy has yet been sold on the California exchange.

According to Megan McArdle, high traffic alone doesn’t explain why the federal healthcare.gov website is having so many issues. For example, the drop-down boxes for security questions aren’t working, which shouldn’t be a traffic-related problem. “The drop-down thing is mystifying,” a programmer source told McArdle. It “could very easily be because deadline pressure caused them to take some shortcuts that impacted their ability to scale.”

Glitches around traffic and web server loads will be relatively easy to fix. The real question is this: will healthier and younger individuals, who stand to face steep premium hikes under Obamacare, pay up? A Manhattan Institute study I helped conduct suggests that average to younger-than-average men will face underlying rate hikes of 97 to 99 percent, with women facing increases of 55 to 62 percent.

AAF: 30-year-old men face average premium hikes of 260%

A new study from the American Action Forum that looks at healthy 30-year-old men finds that underlying premiums for those individuals will increase by an average of 260 percent. The AAF study compared the least-expensive plans available today to the cheapest plans on the Obamacare exchanges, as did the Manhattan Institute study. The MI analysis, by contrast, adjusted those pre-ACA rates to take into account sicker individuals.

In a sense, the AAF study is more relevant to the problem at hand. Obamacare makes healthy people pay more for insurance in order to subsidize sicker people. It makes younger people pay more to subsidize older people. It makes men pay more to subsidize women. It makes everyone pay more to cover benefits, taxes, and fees that consumers might not ordinarily want.

Keep an eye on who enrolls, not just how many

I fully expect that the people who get a good deal out of Obamacare—poorer and sicker individuals—will sign up. The enrollment figures will increase. But the real question isn’t how many people enroll: it’s what kind of people enroll. Two-thirds of the uninsured in America are under the age of 40. What will be the average age of an enrollee on the exchanges? If most enrollees were born before or during the Nixon administration, start worrying.

UPDATE: Sharon Begley of Reuters spoke to a number of IT experts, who believe that the problems with the exchange have to do with its design and architecture, and won’t be easily fixable:

Five outside technology experts interviewed by Reuters, however, say they believe flaws in system architecture, not traffic alone, contributed to the problems.

For instance, when a user tries to create an account on HealthCare.gov, which serves insurance exchanges in 36 states, it prompts the computer to load an unusually large amount of files and software, overwhelming the browser, experts said.

If they are right, then just bringing more servers online, as officials say they are doing, will not fix the site.

“Adding capacity sounds great until you realize that if you didn’t design it right that won’t help,” said Bill Curtis, chief scientist at CAST, a software quality analysis firm, and director of the Consortium for IT Software Quality. “The architecture of the software may limit how much you can add on to it. I suspect they’ll have to reconfigure a lot of it…”

One possible cause of the problems is that hitting “apply” on HealthCare.gov causes 92 separate files, plug-ins and other mammoth swarms of data to stream between the user’s computer and the servers powering the government website, said Matthew Hancock, an independent expert in website design. He was able to track the files being requested through a feature in the Firefox browser.

Of the 92 he found, 56 were JavaScript files, including plug-ins that make it easier for code to work on multiple browsers (such as Microsoft Corp’s Internet Explorer and Google Inc’s Chrome) and let users upload files to HealthCare.gov.

It is not clear why the upload function was included.

“They set up the website in such a way that too many requests to the server arrived at the same time,” Hancock said.

He said because so much traffic was going back and forth between the users’ computers and the server hosting the government website, it was as if the system was attacking itself.

Hancock described the situation as similar to what happens when hackers conduct a distributed denial of service, or DDOS, attack on a website: they get large numbers of computers to simultaneously request information from the server that runs a website, overwhelming it and causing it to crash or otherwise stumble. “The site basically DDOS’d itself,” he said.

INVESTORS’ NOTE: Aetna (NYSE:AET), UnitedHealth (NYSE:UNH), WellPoint (NYSE:WLP), Molina (NYSE:MOH), and Humana (NYSE:HUM) are leading players in developing products for health insurance exchanges. Public exchanges, which opened on October 1, are a key feature of Obamacare’s efforts to expand health insurance coverage.

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Single digits? rofl c’mon forbes, how can you print this article with a straight face. You folks need to post hard facts, or what you say cannot be taken seriously. Anyone with half a brain knows that all of the state exchanges were getting millions of hits per day. NY for example is doing 1million hits per hour, california is doing 10,000 per minute they last reported. So you folks are saying out of those millions of hits one or two people signed up? rofl I call shens.

Hits are different than page views. Looking at one page can mean 20 hits or more at a time because the server is serving images, forms, and other related files to compose the page. I get why in California there were 5 MM hits yet only 650K views. Same goes for all the internet traffic out there.

There was and still is a lot of traffic on the site because people such as myself Looky-Loos! We couldn’t help but look! It’s like an accident! You can’t help it you have to stop and look. Even if some do sign up, The party will be over for them as soon as they figure out they have to have cash up front to see a doctor! Do you PAY to see a doctor or do you PAY the rent or electric bill? Which do you think the average Joe working class American will choose?

The single digits is absent fact, you are correct. Partly because we’re on day 3 now and reporting on actual enrollment is almost non-existent and even reporters who try to sign-up aren’t able too successfully complete. Many stories on people visiting, even stories on people registering, but almost no stories on a completed federal exchange insurance purchase.

Now regardless your metrics, NY is not doing 1 million hits per hour (lol) and California just revised their metrics from 5 million hits to ~650,000 – down 87%. Neither is reporting actual purchases just yet. And the Federal exchange is even more absent in reporting.

While the forbes article is having some schadenfreude, your metrics are just wrong.